Airfare increase gains acceptance

Three carriers will match price set by American

JOSHUA FREED, Associated Press

Published 5:30 am, Saturday, April 30, 2005

MINNEAPOLIS - A fare increase launched by American Airlines appeared to stick on Friday, as Northwest Airlines, Delta Air Lines and Houston-based Continental Airlines said they, too, would raise fares in most U.S. cities.

American blamed fuel prices when it announced fare increases of $5 one-way and $10 round-trip on most domestic and U.S.-Canada flights on Thursday. It was the latest among several fare hikes by U.S. airlines in recent months. Some stuck when competitors matched them; others were abandoned.

Northwest spokesman Kurt Ebenhoch said the airline matched American except in markets where they offer fares to compete with Southwest Airlines and JetBlue Airways. Northwest also didn't raise its higher-priced walk-up business fares, he said.

Continental and Delta also acknowledged matching the increases Friday afternoon.

American said it needs the higher ticket prices to offset high fuel costs. American, a unit of Fort Worth-based AMR Corp., has said that each $1 increase in the price of a barrel of oil costs it about $80 million a year.

Rising fuel prices have bedeviled most airlines this year. Southwest has been an exception, making heavy use of financial hedges to lock in lower prices, including 85 percent of its fuel for the rest of this year at prices that are about half the going rate.